A manager has been using a "Current Technique" to forecast demand for gallons of ice cream for the past six periods. Actual and predicted amounts are shown below.
a) Calculate the MSE for the "Current Technique" forecast
b) Now use the "Naïve method" to forecast demand
c) Calculate the MSE for the "Naïve method" forecast
d) Compare the "Current Technique" forecast with the "Naïve method" forecast. Would a naive forecast have produced better results? Explain
|
Period
|
Demand
|
Forecast
|
|
1
|
90
|
87
|
|
2
|
85
|
88
|
|
3
|
91
|
87
|
|
4
|
92
|
89
|
|
5
|
95
|
90
|
|
6
|
88
|
92
|
Period Demand 95 orecast